PICPA-CAPA Stakeholders Forum Association of Southeast Asian Nations ASEAN Integration ASEAN MRA: The Philippine Compliance Dean Estelita C Aguirre Speaker ASEAN AGREEMENT Roadmap for an ASEAN Community (2009-2015) One vision One identity One Community The ASEAN Economic Community Free flow of goods Free flow of services and skilled labor Free flow of investment Freer flow of capital Harmonized rules, regulations and procedures 1
Free Flow of Professional Services via MRA Mutual Recognition Arrangement for Professionals ASEAN MRA is a multilateral arrangement among ASEAN countries or bilateral arrangement between two ASEAN countries to enable professionals registered in its signatory countries to be equally recognized in another signatory country The ASEAN Mutual Recognition Arrangements Objectives of the MRA on Accountancy Services Engineering Services Dec 2005 Nursing Services Dec 2006 Architecture Nov 2007 Medicine Feb 2009 Dentistry Feb 2009 Tourism Services Nov 2012 Accountancy Services Nov 2014 1 To facilitate mobility of accountants in ASEAN 2 To enhance exchange of information or networking 3 To promote adoption of best practices on standards and qualifications 4 To provide opportunities for capacity building and training 2
Major Events leading to MRA on Accountancy Services Major Events leading to MRA on Accountancy Services 1 Signing of the General Agreement on Trade in Services in 1994 2 Signing of the ASEAN Framework Agreement on Services in 1995 3 Convening of the ASEAN Coordinating Committee on Services 4 Signing of the MRA Framework on Accountancy Services on Feb 26,2009 5 Signing of the Implementing MRA in Nov 2014 6 First meeting of the ASEAN CPA Coordinating Committee in Sept 2015 7 Finalization of Benchmarking and Assessment Statement Mar, 2016 ASEAN MRA Framework on Accountancy Implementing MRA on Accountancy Services Signed in February, 2009 Elements of comparison 1 Education 2 Licenses 3 Competencies 4 Experience 5 Compliance with IFAC Standards and Guidelines Has undergone extensive discussion by regulators of the ten ASEAN countries Ensures provisions that safeguard the interest of the local practice 3
Basic Features of the MRA on Accountancy Services Safeguards to protect the local public practice Scope, with limitation on independent auditor and collaboration requirement (Article 3) Qualification and eligibility of the ASEAN Chartered Professional Accountant (Article 4) Responsible bodies involved: Professional Regulatory Authority/ National Accountancy Body (Article 5) Monitoring Committee (Article 6) ASEAN CPA Coordinating Committee (Article 7) Limits practice to collaboration Does not allow public practice Requires similar competency, assessment, minimum work experience, CPD Requires the issuance of STP Scope of MRA Scope of MRA Par 1, Article 3 of MRA This Arrangement shall cover the provision of accountancy services covered under Central Product Classification (hereinafter referred to as CPC ) 862 of the Provisional CPC of the United Nations, except for signing off of the independent auditor s report and other accountancy services that requires domestic licensing in ASEAN Member States Par 2, Article 3 32 Notwithstanding paragraph 1, crossborder movement of Professional Accountants providing external auditing services and other accountancy-related services that requires domestic licensing in ASEAN Member States may continue to be facilitated through bilateral and/ or multilateral MRAs between or among the Member States 4
How to be an ACPA Qualifications to be an ACPA CPA/CA ACPA RFPA NAB/PRA certification no record of serious violation on technical, professional or ethical standards for accountancy practice Accredited accountancy degree/professional accountancy examination program Valid professional registration certificate in the Country of Origin (CO) by NAB/PRA Comply with Continuing Professional Development (CPD) policy of the CO 3 years or more of relevant post qualifying practical experience within a 5 year period No 1 Qualification of an ACPA No 2 Qualification of an ACPA Accredited accountancy degree/professional accountancy examination program Valid professional registration certificate in the Country of Origin by NAB/PRA 5
No 3 Qualification of ACPA No 4 Qualification of ACPA 3 years or more relevant post qualifying practical experience within a 5 year period Compliance with Continuing Professional Development (CPD) policy of the Country of Origin No 5 Qualification of an ACPA Process to Become an ACPA & RFPA NAB/PRA certification no record of serious violation on technical, professional or ethical standards for accountancy practice NAB/PRA approves application after assessment of ACPA to be permitted to work as RFPA MC assesses the professional accountant in accordance with NAB/PRB rules and submit to ACPACC ACPACC receives and evaluates application if applicant has complied fully with the requirements ACPA submits application to NAB/ PRA (host country) to become an RFPA Successful candidates to pay ACPA subscription fees to be listed on the ACPAR 6
Step 1 Step 2 MC assesses the professional accountant in accordance with NAB/PRB rules and submit to ACPACC ACPACC receives and evaluates application if applicant has complied fully with the requirements Step 3 Step 4 Successful candidates to pay ACPA subscription fees to be listed on the ACPAR ACPA submits application to NAB/ PRA of the host country to become an RFPA 7
Step 5 ASEAN MRA Implementation Plan NAB/PRA approves application after assessment of ACPA to be permitted to work as RFPA ASEAN Australia Development Cooperation Program (Phase II) Consultants: Accounting and Audit Reform Consultants (ARRC) Association of Chartered Certified Accountants (ACCA) ASEAN MRA Implementation Plan Key Areas of Concern Developed Implementation/Action Plans to enhance mobility of ASEAN Professionals on Accounting Services Finalized in March 2016 Participated by Regulators (PRA/NAB) of the 10 ASEAN Countries Benchmarking for ASEAN ASEAN High Level Assessment ACPA Assessment Tool and Answer Sheet ASEAN Evaluation Methodology 8
1 co 5/9/2017 Regional Benchmarks Regional Benchmarks 1 Accredited Accountancy Degree and Professional Accountancy Examination Benchmark: International Accounting Education Standards 2 Relevant practical experience after qualification Benchmark: Relevant practical three years experience within a 5-year period following qualification 3 CPD at a satisfactory level Benchmark: 40 CPD Units in each year or 120 units in each rolling 3-year period per IES 7 4 Compliance with local and international codes of professional conduct Benchmark: Mandatory compliance with Code of Ethics and Investigation/Discipline in place to establish compliance ASEAN Benchmarking Traffic Light Assessment Accountancy Assessment Philippines 2016 PP C & I FULL COMPLIANCE PARTIAL COMPLIANCE NON-COMPLIANCE 1 Institution responsible PRBOA 2 Statute- Republic Act 9892 3 Degree Requirement 4 Professional Examination 5 Practical Experience 6 CPD 7 Code of Ethics 9
Greening the Red & Yellow Lights Board of Accountancy PRBOA Reso 358-2016 (1) Gradual increase in the number of CPD units current 60 units to 120 by 2018 (2) Shift from CPD Thematic Areas to Competence areas categorized as: Technical Competence, Professional Skills and Professional Values, Ethics and Attitudes Board of Accountancy PRBOA Resolution No 3-2016 Philippines MRA Timelines Accreditation of CPAs in C & I Requires accreditation of CPAs on Compilation Services for the Preparation of Financial Statements and Notes thereto 10
MRA Timeline Roadmap Stage 1 MC & AAS 2015 Q1 Establish MC, TOR Assessment process Q2 Official MC formation, approval of TOR Q3 ACPA Assessment 1 st draft Q4 Circulate AAS to key stakeholders for comment 2016 Q1 Collation of Stakeholders inputs/develop website Q2 AAS Submission to ACPACC Q3 Refine and Finalize AAS Q4 Final AAS submission to ACPACC/AAS approval by ACPACC/ Website launch MRA Timeline Roadmap Stage 2: ACPAR 2017 Q1 Q2 Issuance of PRBOA Resolution on MRA implementation ACPA Online Promotion Campaign ACPA Applications and assessment by MC/ACPAR National Level Q3 ACPA Recommends ACPA to ACPACC Q4 ACPACC Approval of ACPA ACPAR ASEAN level central register MRA Timeline Roadmap Stage 3:Networking Philippine Government Support House of Representatives Reso # 187 2018 Q1 Q2 Q3 2019 Q1 Q2 Q3 Q4 ACPA Networking Identify areas of collaboration & related services Develop Regional Capacity Building Program and raise capacity and competency of ACPA Engagement with Key Stakeholders Promote RFPA Registration RFPA Registration by HC RFPA Networking & Testimonies Requested the Office of the President to issue a Memorandum Circular to fully implement the MRA with safety nets; and allocate budget to be known as the ASEAN Competitiveness fund July 28, 2014 11
Philippine Government Support Memo from Executive Secretary Professional Regulation Commission 2012 Assessment Report Office of the President ordered DFA and PRC to take the lead in drafting the Presidential issuances for the effective implementation of MRA; All accredited professional organizations to be directly and actively involved in the task April 13, 2015 The PRC conducted a Rapid Assessment of all professions on its readiness for the 2015 ASEAN Integration through an Australian Consultant, Jane Brake- Brockman In Brockman s June 26, 2012 report, she stated that in accountancy, Philippines is globally competitive despite the derailed implementation of the QAR ASEAN MRA Application for ACPA Member No of Units Application Per 3 years for ACPA 1 Brunei 120 None 2 Cambodia 120 None 3 Indonesia 120 None End of Presentation 4 Lao PDR 120 None 5 Malaysia 120 None 6 Myanmar 120 None 7 Philippines 80 in 2017; 120 in 2019 None 8 Singapore 120 None 9 Thailand 120 None aitecaguirre@gmailcom 10 Vietnam 120 None 12